Pennsylvania offering loans to small businesses struggling from COVID-19 restrictions

Certain small businesses will be able to get three-year loans of up to $100,000

Main Street in Manayunk, a corridor lined with small businesses, appears deserted on Tuesday, March 16, 2020, because of restrictions due to the coronavirus pandemic. Pennsylvania is looking to help small businesses impacted with loans through the new COVID-19 Working Capital Access Program.

Pennsylvania has launched a small business relief fund to provide loans and aid to businesses losing revenue from the state's coronavirus restrictions.

Gov. Tom Wolf announced the launch of the COVID-19 Working Capital Access Program on Wednesday. The loans will be funded by a budget of $60 million from the Pennsylvania Industrial Development Authority. For-profit businesses with 100 or fewer employees can apply for loans of up to $100,000.

Loan terms will be three years long for state's CWCA, with a 0% interest rate, except for agricultural producers. Those loans will have interest rates of 2%. Funds are expected to become available this week. The amortization rate is 12 years.

Small business that get the loans will not be required to make any payments for one year. For the loans with 2% interest, interest payments will be due monthly during the second and third years, with a balloon payment at the end of the three-year period.

CWCA Loans are meant to be used for working capital, which is defined by the program as money "used by a small business for operations, excluding fixed assets and production machinery and equipment."

Applications must be submitted through Certified Economic Development Organizations, which are nonprofit partners with PIDA, working to administer loans in this program. CEDO's are organized by county on and listed on the CEDO website alongside their contact information.

The Philadelphia CEDO is the Philadelphia Industrial Development Corporation. Contact information is on their website.

Businesses wishing to get a loan should contact their local CEDO, which will be able to help a business determine if it is eligible. Other questions about the program can be directed to (717) 783-5046, and more information on the program itself is available here.